AMENDED AND RESTATED SUBORDINATED GUARANTY AND PLEDGE AGREEMENT

Exhibit 10.3

AMENDED AND RESTATED SUBORDINATED GUARANTY AND PLEDGE
AGREEMENT

Dated as of

made by

Teton Energy Corporation
and
each of the other Obligors

in favor of

The Bank of New York Mellon Trust Company, N.A. as Successor in Interest To
Whitebox Advisors, LLC
as subordinated noteholder representative

The indebtedness and other obligations of the Borrower and its subsidiaries evidenced by, and the lien created by this Agreement or referred to herein on the property described herein is junior and subordinate to the indebtedness and other obligations of the Borrower and its subsidiaries and any lien on such property created by any similar instrument now or hereafter executed by the Borrower and its subsidiaries in favor of JPMorgan Chase Bank, N.A. , as administrative agent, and its successors and assigns in such capacity, in such property, accordance with the provisions of the Amended and Restated Intercreditor and Subordination Agreement dated as of September 19, 2008, among JPMorgan Chase Bank, N.A., as Senior Agent, The Bank of New York Mellon Trust Company, N.A., as Subordinated Holder Representative and collateral agent, the Borrower and certain of its affiliates, as amended from time to time.

TABLE OF CONTENTS

     This AMENDED AND RESTATED SUBORDINATED GUARANTY AND PLEDGE AGREEMENT, dated as of September 19, 2008, is made by TETON ENERGY CORPORATION, a Delaware corporation (the “ Borrower ”), and each of the signatories hereto (the Borrower and each of the signatories hereto, together with any other Subsidiary or holding company of the Borrower that becomes a party hereto from time to time after the date hereof, the “ Obligors ”), in favor of THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. , a national banking association, as successor in interest to WHITEBOX ADVISORS, LLC, as agent for the Subordinated Noteholders (in such capacity, together with its successors in such capacity, the “ Subordinated Noteholder Representative ”).

RECITALS

     A. The Borrower has previously entered into that certain Amended and Restated Credit Agreement dated as of August 9, 2007, among the Borrower, the financial institutions party thereto (the “ Lenders ”), and JPMorgan Chase Bank, NA, as administrative agent (the “ Senior Agent ”) for the Lenders (as heretofore amended, supplemented or restated, the “ Existing Credit Agreement ”).

     B. As a condition precedent to the obligation of the Lenders to make their respective extensions of credit to the Borrower under the Existing Credit Agreement, the Obligors executed and delivered that certain Amended and Restated Guaranty and Pledge Agreement dated as of August 9, 2007 (the “ Existing Guaranty and Pledge Agreement ”) to Senior Agent for the ratable benefit of the Lenders.

     C. The Existing Credit Agreement was amended and restated in its entirety as a Second Amended and Restated Credit Agreement dated as of April 2, 2008 by and among the Borrower, the Lenders and the Senior Agent (as amended, supplemented or restated from time to time, the “ Credit Agreement ”), pursuant to which the Lenders have agreed to extend credit to the Borrower.

     D. The Existing Guaranty and Pledge Agreement was amended and restated in its entirety as an Amended and Restated Guaranty and Pledge Agreement dated as of April 2, 2008 by and among the Borrower, the Obligors, the Lenders and the Senior Agent (as amended, supplemented or restated from time to time, the “ Senior Guaranty and Pledge Agreement ”), pursuant to which the Lenders have agreed to extend credit to the Borrower.

     E. The Borrower has entered into a Securities Purchase Agreement dated as of June 9, 2008 (as amended, supplemented or restated from time-to-time, the “ Purchase Agreement ”) together with certain ancillary agreements (the Security Documents, together with the other Transaction Documents, collectively the “ Transaction Documents ” as defined in the Purchase Agreement) with the Purchasers signatory thereto and their respective successors and assigns (the “ Subordinated Noteholders ”), including, without limitation, the Intercreditor and Subordination Agreement with the Senior Agent, the provisions of which shall be applicable to this Agreement, whether specifically referred to in any particular section or not.

     F. The securities issued pursuant to the Purchase Agreement are being exchanged for the Exchanged Debentures (as hereinafter defined) being issued pursuant to the Indenture (as hereinafter defined).

     G. The trustee under the Indenture, The Bank of New York Mellon Trust Company, N.A., is being appointed as Subordinated Noteholder Representative pursuant to an amendment to the Purchase Agreement of even date herewith.

     H. The parties desire to amend and restate the Agreement in its entirety hereby.

     I. Now, therefore, in consideration of the premises herein and to induce The Bank of New York Mellon Trust Company, N.A., the successor in interest to Whitebox Advisors, LLC, as the Subordinated Noteholder Representative, and the Subordinated Noteholders to enter into revised Transaction Documents with the Borrower and to induce the Subordinated Noteholders to make their respective extensions of credit to the Borrower thereunder, each Obligor hereby agrees with the Subordinated Noteholder Representative, for the ratable benefit of the Subordinated Noteholders as follows:

ARTICLE I
Definitions

     Section 1.01 Definitions .

          (a) Unless otherwise defined herein, terms defined in any Transaction Document and used herein have the meanings given to them in such Transaction Document, and all uncapitalized terms which are defined in the UCC as in effect in the State of New York on the date hereof are used herein as so defined.

          (b) The following terms have the following meanings:

          “ Agreement ” means this Amended and Restated Subordinated Guaranty and Pledge Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.

          “ Bankruptcy Code ” means title 11, United States Code, as amended from time to time.

          “ Collateral ” has the meaning assigned such term in Section 3.01 .

          “ Exchanged Debentures ” has the meaning given that term in the Intercreditor and Subordination Agreement.

          “ Guaranteed Creditors ” means the collective reference to the Subordinated Noteholder Representative and the Subordinated Noteholders.

          “ Guaranteed Documents ” means the Purchase Agreement, the Security Documents, and other Transaction Documents.

          “ Guarantor Obligations ” means with respect to any Guarantor, the collective reference to (a) the Obligations and (b) all obligations and liabilities of such Guarantor which may arise under or in connection with any Guaranteed Document to which such Guarantor is a party, in each case, whether on account of principal, interest, guarantee obligations, reimbursement obligations, payments in respect of an early termination date, fees, indemnities, costs, expenses or otherwise (including, without limitation, all reasonable fees and disbursements of counsel to any Guaranteed Creditor under any Guaranteed Document).

          “ Guarantors ” means the collective reference to each Obligor other than the Borrower.

          “ Indenture ” has the meaning given such term in the Intercreditor and Subordination Agreement.

          “ Intercreditor and Subordination Agreement ” means that certain Intercreditor and Subordination Agreement dated June 9, 2008 among the Borrower, subsidiaries of the Borrower party thereto, JPMorgan Chase Bank, N.A., as Senior Agent, and Whitebox Teton, Ltd.,. as collateral agent for the Subordinated Noteholders, as amended and restated by that certain Amended and Restated Intercreditor and Subordination Agreement of even date herewith among the Borrower, subsidiaries of the Borrower party thereto, JPMorgan Chase Bank, N.A., as Senior Agent, and The Bank of New York Mellon Trust Company, N.A., as Subordinated Holder Representative and collateral agent, as further amended, supplemented or restated from time to time.

          “ Issuers ” means the collective reference to each issuer of a Pledged Security.

          “ LLC ” means, with respect to each Pledgor, each limited liability company described or referred to in Schedule 2 in which such Pledgor has an interest.

          “ LLC Agreement ” means, with respect to each Pledgor, each operating agreement or other governing documents relating to an LLC, as each agreement has heretofore been, and may hereafter be, amended, restated, supplemented or otherwise modified from time to time.

          “ Obligations ” means: (a) in the case of the Borrower, the obligations of the Borrower under each of the Transaction Documents, the Exchanged Debentures and the Indenture, and (b) in the case of each Guarantor, its Guarantor Obligations.

          “ Obligor Claims ” has the meaning assigned to such term in Section 8.01 .

          “ Partnership ” means, with respect to each Pledgor, each partnership described or referred to in Schedule 2 in which such Pledgor has an interest.

          “ Partnership Agreement ” means, with respect to each Pledgor, each partnership agreement governing a Partnership, as each such agreement has heretofore been, and may hereafter be, amended, restated, supplemented or otherwise modified.

          “ Pledged LLC Interests ” means, with respect to each Pledgor, all right, title and interest of such Pledgor as a member of each LLC and all right, title and interest of any Pledgor in, to and under each LLC Agreement.

          “ Pledged Partnership Interests ” means, with respect to each Pledgor, all right, title and interest of such Pledgor as a limited or general partner in all Partnerships and all right, title and interest of any Pledgor in, to and under the Partnership Agreements.

          “ Pledged Securities ” means: (a) the equity interests described or referred to in Schedule 2 (as the same may be supplemented from time to time pursuant to a Supplement); and (b) (i) the certificates or instruments, if any, representing such Equity Interests, (ii) all dividends (cash, equity interests or otherwise), cash, instruments, rights to subscribe, purchase or sell and all other rights and property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such securities, (iii) all replacements, additions to and substitutions for any of the property referred to in this definition, including, without limitation, claims against third parties, (iv) the proceeds, interest, profits and other income of or on any of the property referred to in this definition, (v) all security entitlements in respect of any of the foregoing, if any and (vi) all books and records relating to any of the property referred to in this definition.

          “ Pledgor ” means any Obligor that now or hereafter pledges Pledged Securities hereunder.

          “ Proceeds ” means all “proceeds” as such term is defined in Section 9.102(65) of the Uniform Commercial Code in effect in the State of Texas on the date hereof and, in any event, shall include, without limitation, all dividends or other income from the Pledged Securities, collections thereon or distributions or payments with respect thereto.

          “ Securities Act ” shall mean the Securities Act of 1933, as amended.

          “ Supplement ” means a Supplement substantially in the form attached hereto as Annex II .

          “ UCC ” means the Uniform Commercial Code as from time to time in effect in the State of New York; provided, however, that, in the event that, by reason of mandatory provisions of law, any of the attachment, perfection or priority of the Subordinated Noteholder Representative’s and the Guaranteed Creditors’ security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection, the effect thereof or priority and for purposes of definitions related to such provisions.

     Section 1.02 Other Definitional Provisions . Where the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Pledgor, refer to such Pledgor’s Collateral or the relevant part thereof.

ARTICLE II
Guarantee

     Section 2.01 Guarantee .

          (a) Upon the terms and subject to the conditions of this Agreement, each of the Guarantors hereby jointly and severally, unconditionally and irrevocably, guarantees to the Guaranteed Creditors and each of their respective successors, indorsees, transferees and assigns, the prompt and complete payment in cash and performance by the Borrower when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations. This is a guarantee of payment and not collection and the liability of each Guarantor is primary and not secondary.

          (b) Anything herein or in any other Transaction Document to the contrary notwithstanding, the maximum liability of each Guarantor hereunder and under the other Transaction Documents shall in no event exceed the amount which can be guaranteed by such Guarantor under applicable federal and state laws relating to the insolvency of debtors (after giving effect to the right of contribution established in Section 2.02 ).

          (c) Each Guarantor agrees that the Obligations may at any time and from time to time exceed the amount of the liability of such Guarantor hereunder without impairing the guarantee contained in this Article II or affecting the rights and remedies of any Guaranteed Creditor hereunder.

          (d) Each Guarantor agrees that if the maturity of the Obligations is accelerated by bankruptcy or otherwise, such maturity shall also be deemed accelerated for the purpose of this guarantee without demand or notice to such Guarantor. The guarantee contained in this Article II shall remain in full force and effect until all the Obligations shall have been satisfied by payment in full in cash.

          (e) No payment made by any Obligor, any other guarantor or any other Person or received or collected by any Guaranteed Creditor from the Borrower, any of the Guarantors, any other guarantor or any other Person by virtue of any action or proceeding or any set-off or appropriation or application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than any payment made by such Guarantor in respect of the Obligations or any payment received or collected from such Guarantor in respect of the Obligations), remain liable for the Obligations up to the maximum liability of such Guarantor hereunder until the Obligations are paid in full in cash.

     Section 2.02 Right of Contribution . Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment. Each Guarantor’s right of contribution shall be subject to the terms and conditions of Section 2.03 . The provisions of this Section 2.02 shall in no respect limit the obligations and liabilities of any

Guarantor to the Guaranteed Creditors, and each Guarantor shall remain liable to the Guaranteed Creditors for the full amount guaranteed by such Guarantor hereunder.

     Section 2.03 No Subrogation . Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any Guarantor by any Guaranteed Creditor, no Guarantor shall be entitled to be subrogated to any of the rights of any Guaranteed Creditor against the Borrower or any other Guarantor or any collateral security or guarantee or right of offset held by any Guaranteed Creditor for the payment of the Obligations, nor shall any Guarantor seek or be entitled to seek any indemnity, exoneration, participation, contribution or reimbursement from the Borrower or any other Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Guaranteed Creditors by the Borrower on account of the Obligations are irrevocably and indefeasibly paid in full in cash. If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been irrevocably and indefeasibly paid in full in cash, such amount shall be held by such Guarantor in trust for the Guaranteed Creditors, and shall, forthwith upon receipt by such Guarantor, be turned over to the Subordinated Noteholder Representative in the exact form received by such Guarantor (duly indorsed by such Guarantor to the Subordinated Noteholder Representative, if required), to be applied against the Obligations, whether matured or unmatured, in accordance with Section 6.10 of the Indenture.

     Section 2.04 Guaranty Amendments, Etc. with respect to the Obligations . Each Guarantor shall remain obligated hereunder, and such Guarantor’s obligations hereunder shall not be released, discharged or otherwise affected, notwithstanding that, without any reservation of rights against any Guarantor and without notice to, demand upon or further assent by any Guarantor (which notice, demand and assent requirements are hereby expressly waived by such Guarantor), (a) any demand for payment of any of the Obligations made by any Guaranteed Creditor may be rescinded by such Guaranteed Creditor or otherwise and any of the Obligations continued; (b) the Obligations, the liability of any other Person upon or for any part thereof or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by, or any indulgence or forbearance in respect thereof granted by, any Guaranteed Creditor; (c) any Guaranteed Document may be amended, modified, supplemented or terminated, in whole or in part, as the Guaranteed Creditors may deem advisable from time to time; (d) any collateral security, guarantee or right of offset at any time held by any Guaranteed Creditor for the payment of the Obligations may be sold, exchanged, waived, surrendered or released; (e) any additional guarantors, makers or endorsers of the Borrower’s Obligations may from time to time be obligated on the Borrower’s Obligations or any additional security or collateral for the payment and performance of the Borrower’s Obligations may from time to time secure the Borrower’s Obligations; or (f) any other event shall occur which constitutes a defense or release of sureties generally. No Guaranteed Creditor shall have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for the guarantee contained in this Article II or any property subject thereto.

     Section 2.05 Waivers . Each Guarantor hereby waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by any Guaranteed Creditor upon the guarantee contained in this Article II or acceptance of the

guarantee contained in this Article II; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guarantee contained in this Article II and no notice of creation of the Obligations or any extension of credit already or hereafter contracted by or extended to the Borrower need be given to any Guarantor; and all dealings between the Borrower and any of the Guarantors, on the one hand, and the Guaranteed Creditors, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the guarantee contained in this Article II. Each Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon the Borrower or any of the Guarantors with respect to the Obligations.

     Section 2.06 Guaranty Absolute and Unconditional .

          (a) Each Guarantor understands and agrees that the guarantee contained in this Article II is, and shall be construed as, a continuing, completed, absolute and unconditional guarantee of payment, and each Guarantor hereby waives any defense of a surety or guarantor or any other obligor on any obligations arising in connection with or in respect of any of the following and hereby agrees that its obligations hereunder shall not be discharged or otherwise affected as a result of any of the following:

               (i) the invalidity or unenforceability of any Guaranteed Document, any of the Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by any Guaranteed Creditor;

               (ii) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Borrower or any other Person against any Guaranteed Creditor;

               (iii) the insolvency, bankruptcy arrangement, reorganization, adjustment, composition, liquidation, disability, dissolution or lack of power of the Borrower or any other Guarantor or any other Person at any time liable for the payment of all or part of the Obligations, including any discharge of, or bar or stay against collecting, any Obligation (or any part of them or interest therein) in or as a result of such proceeding;

               (iv) any sale, lease or transfer of any or all of the assets of the Borrower or any other Guarantor, or any changes in the shareholders of the Borrower or any other Guarantor;

               (v) any change in the corporate existence (including its constitution, laws, rules, regulations or power), structure or ownership of any Obligor or in the relationship between the Borrower and any Obligor;

               (vi) the fact that any Collateral or Lien contemplated or intended to be given, created or granted as security for the repayment of the Obligations shall not be properly perfected or created, or shall prove to be unenforceable or subordinate to any other Lien, it being recognized and agreed by each of the Guarantors that it is not

entering into this Agreement in reliance on, or in contemplation of the benefits of, the validity, enforceability, collectability or value of any of the Collateral for the Obligations;

               (vii) the absence of any attempt to collect the Obligations or any part of them from any Obligor;

               (viii) (A) any Guaranteed Creditor’s election, in any proceeding instituted under chapter 11 of the Bankruptcy Code, of the application of Section 1111(b)(2) of the Bankruptcy Code; (B) any borrowing or grant of a Lien by the Borrower, as debtor-in-possession, or extension of credit, under Section 364 of the Bankruptcy Code; (C) the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of any Guaranteed Creditor’s claim (or claims) for repayment of the Obligations; (D) any use of cash collateral under Section 363 of the Bankruptcy Code; (E) any agreement or stipulation as to the provision of adequate protection in any bankruptcy proceeding; (F) the avoidance of any Lien in favor of the Guaranteed Creditors or any of them for any reason; or (G) failure by any Guaranteed Creditor to file or enforce a claim against the Borrower or its estate in any bankruptcy or insolvency case or proceeding; or

               (ix) any other circumstance or act whatsoever, including any action or omission of the type described in Section 2.04 (with or without notice to or knowledge of the Borrower or such Guarantor), which constitutes, or might be construed to constitute, an equitable or legal discharge of the Borrower for the Obligations, or of such Guarantor under the guarantee contained in this Article II, in bankruptcy or in any other instance.

          (b) When making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, any Guaranteed Creditor may, but shall be under no obligation to, join or make a similar demand on or otherwise pursue or exhaust such rights and remedies as it may have against the Borrower, any other Guarantor or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by any Guaranteed Creditor to make any such demand, to pursue such other rights or remedies or to collect any payments from the Borrower, any other Guarantor or any other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of the Borrower, any other Guarantor or any other Person or any such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of any Guaranteed Creditor against any Guarantor. For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.

     Section 2.07 Reinstatement . The guarantee contained in this Article II shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned by any Guaranteed Creditor upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payments had not been made.

     Section 2.08 Payments . Each Guarantor hereby guarantees that payments hereunder will be paid to the Subordinated Noteholder Representative, for the ratable benefit of the Guaranteed Creditors, without set-off, deduction or counterclaim, in dollars, in immediately available funds, at the offices of the Subordinated Noteholder Representative as specified in Section 5.4 of the Purchase Agreement.

ARTICLE III
Grant of Security Interest

     Section 3.01 Grant of Security Interest . Subject only to the prior pledge of each such item of Collateral to the Senior Agent, under the Senior Guaranty and Pledge Agreement, which such prior pledge is acknowledged by the Subordinated Noteholder Agent and each Guaranteed Creditor, each Pledgor hereby pledges, assigns and transfers to the Subordinated Noteholder Representative, and hereby grants to the Subordinated Noteholder Representative, for the ratable benefit of the Guaranteed Creditors, a security interest in all of the following property now owned or at any time hereafter acquired by such Pledgor or in which such Pledgor now has or at any time in the future may acquire any right, title or interest (collectively, the “ Collateral ”), as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of such Pledgor’s Obligations:

          (a) all Pledged Securities;

          (b) all books and records pertaining to the Collateral; and

          (c) to the extent not otherwise included, all Proceeds and products of any and all of the foregoing and all collateral security and guarantees given by any Person with respect to any of the foregoing.

     Section 3.02 Transfer of Pledged Securities . All certificates or instruments representing or evidencing such Pledged Securities shall be delivered to and held pursuant hereto by the Subordinated Noteholder Representative or a Person designated by the Subordinated Noteholder Representative (which such designee shall be the Senior Agent until the termination of the security interest created by the Senior Guaranty and Pledge Agreement, after which such time, the designee shall be the Subordinated Noteholder Representative) and shall be in suitable form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignment in blank, and accompanied by any required transfer tax stamps to effect the pledge of the Pledged Securities to the Subordinated Noteholder Representative. Notwithstanding the preceding sentence, at the Subordinated Noteholder Representative’s reasonable discretion, all such Pledged Securities must be delivered or transferred in such manner as to permit the Subordinated Noteholder Representative to be a “protected purchaser” to the extent of its security interest as provided in Section 8.303 of the UCC (if the Subordinated Noteholder Representative otherwise qualifies as a protected purchaser). During the continuance of an Event of Default, the Subordinated Noteholder Representative, subject to its compliance with applicable federal and state securities laws and the prior rights of the Senior Agent, shall have the right, at any time in its discretion and without notice, to transfer to or to register in the name of the Subordinated Noteholder Representative or any of its nominees any or all of the Pledged Securities, subject only to the revocable rights specified in Section 6.03 . In addition, during the

continuance of an Event of Default, the Subordinated Noteholder Representative shall have the right at any time to exchange certificates or instruments representing or evidencing Pledged Securities for certificates or instruments of smaller or larger denominations.

ARTICLE IV
Representations and Warranties

     To induce the Subordinated Noteholder Representative and the Subordinated Noteholders to enter into the Transaction Documents and to induce the Subordinated Noteholders to make their respective extensions of credit to the Borrower thereunder, each Obligor hereby represents and warrants to the Subordinated Noteholder Representative and each Subordinated Noteholder that:

     Section 4.01 Representations in Credit Agreement . In the case of each Guarantor, the representations and warranties set forth in Section 3.1 of the Purchase Agreement as they relate to such Guarantor or to the Transaction Documents to which such Guarantor is a party are true and correct in all material respects, provided that each reference in each such representation and warranty to the Borrower’s knowledge shall, for the purposes of this Section 4.01 , be deemed to be a reference to such Guarantor’s knowledge.

     Section 4.02 Title; No Other Liens . Except for the security interest granted to the Senior Agent for the ratable benefit of the Lenders under the Credit Agreement and the Subordinated Noteholder Representative for the ratable benefit of the Guaranteed Creditors pursuant to this Agreement, such Pledgor is the record and beneficial owner of its respective items of the Collateral free and clear of any and all Liens and has rights in or the power to transfer each item of the Collateral in which a Lien is granted by it hereunder, free and clear of any Lien. No financing statement or other public notice with respect to all or any part of the Collateral is on file or of record in any public office, except such as have been filed in favor of the Senior Agent, for the ratable benefit of the Lenders or the Subordinated Noteholder Representative, for the ratable benefit of the Guaranteed Creditors, pursuant to this Agreement or the Security Documents.

     Section 4.03 Perfected Second Priority Liens . The security interests granted pursuant to this Agreement (a) upon the completion of the filings and the other actions specified on Schedule 3 constitute valid perfected security interests in all of the Collateral in favor of the Subordinated Noteholder Representative, for the ratable benefit of the Guaranteed Creditors, as collateral security for such Pledgor’s Obligations, enforceable in accordance with the terms hereof against all creditors of such Pledgor and any Persons purporting to purchase any Collateral from such Pledgor and (b) are prior to all other Liens on the Collateral in existence on the date hereof other than the prior Liens in favor of the Senior Agent for the ratable benefit of the Lenders.

     Section 4.04 Obligor Information . On the date hereof, the correct legal name of such Obligor, all names and trade names that such Obligor has used in the last five years, such Obligor’s jurisdiction of organization and each jurisdiction of organization of such Obligor over the last five years, organizational number, taxpayer identification number, and the location(s) of

such Obligor’s chief executive office or sole place of business over the last five years are specified on Schedule 4 .

     Section 4.05 Pledged Securities .

          (a) The Pledged Securities required to be pledged hereunder by such Pledgor are listed in Schedule 2 . The shares of Pledged Securities pledged by such Pledgor hereunder constitute all the issued and outstanding shares of all classes of the equity interests of each Issuer owned by such Pledgor. All the shares of the Pledged Securities have been duly and validly issued and are fully paid and nonassessable; and such Pledgor is the record and beneficial owner of, and has good title to, the Pledged Securities pledged by it hereunder, free of any and all Liens or options in favor of, or claims of, any other Person, except the security interest created by this Agreement or by the Senior Guaranty and Pledge Agreement, and has rights in or the power to transfer the Pledged Securities in which a Lien is granted by it hereunder, free and clear of any Lien.

          (b) There are no restrictions on transfer (that have not been waived or otherwise consented to) in the LLC Agreement governing any Pledged LLC Interest and the Partnership Agreement governing any Pledged Partnership Interest or any other agreement relating thereto which would limit or restrict (i) the grant of a security interest in the Pledged LLC Interests and the Pledged Partnership Interests, (ii) the perfection of such security interest or (iii) the exercise of remedies in respect of such perfected security interest in the Pledged LLC Interests and the Pledged Partnership Interests, in each case, as contemplated by this Agreement. Upon the exercise of remedies in respect of the Pledged LLC Interests and the Pledged Partnership Interests, a transferee or assignee of a membership interest or partnership interest, as the case may be, of such LLC or Partnership, as the case may be, shall become a member or partner, as the case may be, of such LLC or Partnership, as the case may be, entitled to participate in the management thereof and, upon the transfer of the entire interest of such Pledgor, such Pledgor ceases to be a member or partner, as the case may be.

     Section 4.06 Benefit to the Guarantor . The Borrower is a member of an affiliated group of companies that includes each Guarantor, and the Borrower and the other Guarantors are engaged in related businesses. Each Guarantor is a Subsidiary of the Borrower and its guaranty and surety obligations pursuant to this Agreement may reasonably be expected to benefit, directly or indirectly, such Subsidiary; and each Guarantor has determined that this Agreement is necessary and convenient to the conduct, promotion and attainment of the business of such Guarantor and the Borrower.

     Section 4.07 Solvency . Each Obligor (a) is not insolvent as of the date hereof and will not be rendered insolvent as a result of this Agreement (after giving effect to Section 2.02), (b) is not engaged in business or a transaction, or about to engage in a business or a transaction, for which any property remaining with it constitutes unreasonably small capital, and (c) does not intend to incur, or believe it will incur, Debt that will be beyond its ability to pay as such Debt matures.

ARTICLE V
Covenants

     Each Obligor covenants and agrees with the Subordinated Noteholder Representative and the Subordinated Noteholders that, from and after the date of this Agreement until the Obligations shall have been paid in full in cash:

     Section 5.01 Maintenance of Perfected Security Interest; Further Documentation . Each Pledgor agrees that:

          (a) it shall maintain the security interest created by this Agreement as a perfected security interest having at least the priority described in Section 4.03 and shall defend such security interest against the claims and demands of all Persons whomsoever.

          (b) it will furnish to the Subordinated Noteholder Representative from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Subordinated Noteholder Representative may reasonably request, all in reasonable detail.

          (c) At any time and from time to time, upon the written request of the Subordinated Noteholder Representative, and at the sole expense of such Pledgor, it will promptly and duly execute and deliver, and have recorded, such further instruments and documents and take such further actions as the Subordinated Noteholder Representative may reasonably deem necessary for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, the delivery of certificated securities and the filing of any financing or continuation statements under the UCC (or other similar laws) in effect in any jurisdiction with respect to the security interests created hereby.

     Section 5.02 Changes in Locations, Name, Etc . Such Obligor recognizes that financing statements pertaining to the Collateral have been or may be filed where such Obligor maintains any Collateral or is organized. Such Obligor will not cause or permit any change in its (a) corporate name or in any trade name used to identify it in the conduct of its business or in the ownership of its properties, (b) the location of its chief executive office or principal place of business, (c) its identity or corporate structure or in the jurisdiction in which it is incorporated or formed, (d) its jurisdiction of organization or its organizational identification number in such jurisdiction of organization or (e) its federal taxpayer identification number, unless, in each case, such Obligor shall have first (i) notified the Subordinated Noteholder Representative of such change at least thirty (30) days prior to the effective date of such change, and (ii) taken all action reasonably requested by the Subordinated Noteholder Representative for the purpose of maintaining the perfection and priority of the Subordinated Noteholder Representative’s security interests under this Agreement. In any notice furnished pursuant to this Section 5.02 , such Obligor will expressly state in a conspicuous manner that the notice is required by this Agreement and contains facts that may require additional filings of financing statements or other notices for the purposes of continuing perfection of the Subordinated Noteholder Representative’s security interest in the Collateral. At the request of the Subordinated Noteholder Representative, on or prior to the occurrence of such event, the Borrower will

provide to the Subordinated Noteholder Representative and the Subordinated Noteholders an opinion of counsel, in form and substance reasonably satisfactory to the Subordinated Noteholder Representative, to the effect that such event will not impair the validity of the security interests hereunder, the perfection and priority thereof, the enforceability of the Transaction Documents, and such other matters as may be reasonably requested by the Subordinated Noteholder Representative.

     Section 5.03 Pledged Securities .

          (a) If such Pledgor shall become entitled to receive or shall receive any stock certificate (including, without limitation, any certificate representing a stock dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights in respect of the equity interests of any Issuer, whether in addition to, in substitution of, as a conversion of, or in exchange for, any shares of the Pledged Securities, or otherwise in respect thereof, such Pledgor shall accept the same as the agent of the Guaranteed Creditors, hold the same in trust for the Guaranteed Creditors, segregated from other property of such Pledgor, and, subject to any prior rights of the Senior Agent, deliver the same forthwith to the Subordinated Noteholder Representative in the exact form received, duly indorsed by such Pledgor to the Subordinated Noteholder Representative, if required, together with an undated stock power covering such certificate duly executed in blank by such Pledgor and with, if the Subordinated Noteholder Representative so requests, signature guaranteed, to be held by the Subordinated Noteholder Representative, subject to the terms hereof, as additional collateral security for the Obligations.

          (b) Without the prior written consent of the Subordinated Noteholder Representative, such Pledgor will not (i) unless otherwise expressly permitted hereby or under the other Transaction Documents, vote to enable, or take any other action to permit, any Issuer to issue any equity interests of any nature or to issue any other securities convertible into or granting the right to purchase or exchange for any equity interests of any nature of any Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose of, or grant any option with respect to, the Pledged Securities or Proceeds thereof (except pursuant to a transaction expressly permitted by the Transaction Documents), (iii) create, incur or permit to exist any Lien or option in favor of, or any claim of any Person with respect to, any of the Pledged Securities or Proceeds thereof, or any interest therein, except for the security interests created by this Agreement and the Senior Guaranty and Pledge Agreement or (iv) enter into any agreement or undertaking restricting the right or ability of such Pledgor or the Subordinated Noteholder Representative to sell, assign or transfer any of the Pledged Securities or Proceeds thereof.

          (c) In the case of each Pledgor that is an Issuer, such Issuer agrees that (i) it will be bound by the terms of this Agreement relating to the Pledged Securities issued by it and will comply with such terms insofar as such terms are applicable to it, (ii) it will notify the Subordinated Noteholder Representative promptly in writing of the occurrence of any of the events described in Section 5.03(a) with respect to the Pledged Securities issued by it and (iii) the terms of Sections Section 6.02(a) and Section 6.03 shall apply to it, mutatis mutandis , with respect to all actions that may be required of it pursuant to Section 6.02(d) or Section 6.03 with respect to the Pledged Securities issued by it.

          (d) In the case of each Pledgor that is a partner in a Partnership, such Pledgor hereby consents to the extent required by the applicable Partnership Agreement to the pledge by each other Pledgor, pursuant to the terms hereof, of the Pledged Partnership Interests in such Partnership and to the transfer of such Pledged Partnership Interests to the Subordinated Noteholder Representative or its nominee and to the substitution of the Subordinated Noteholder Representative or its nominee as a substituted partner in such Partnership with all the rights, powers and duties of a general partner or a limited partner, as the case may be. In the case of each Pledgor member of an LLC, such Pledgor hereby consents to the extent required by the applicable LLC Agreement to the pledge by each other Pledgor, pursuant to the terms hereof, of the Pledged LLC Interests in such LLC and to the transfer of such Pledged LLC Interests to the Subordinated Noteholder Representative or its nominee and to the substitution of the Subordinated Noteholder Representative or its nominee as a substituted member of the LLC with all the rights, powers and duties of a member of the LLC in question.

          (e) Such Pledgor shall not agree to any amendment of a Partnership Agreement or LLC Agreement that in any way adversely affects the perfection of the security interest of the Subordinated Noteholder Representative in the Pledged Partnership Interests or Pledged LLC Interests pledged by such Pledgor hereunder, including any amendment electing to treat the membership interest or partnership interest of such Pledgor as a security under Section 8-103 of the UCC.

          (f) Each Pledgor shall furnish to the Subordinated Noteholder Representative such stock powers and other instruments as may be required by the Subordinated Noteholder Representative to assure the transferability of the Pledged Securities when and as often as may be reasonably requested by the Subordinated Noteholder Representative.

          (g) The Pledged Securities will at all times constitute not less than 100% of the equity interests of the Issuer thereof owned by any Pledgor. Each Pledgor will not permit any Issuer of any of the Pledged Securities to issue any new shares of any class of equity interests of such Issuer without the prior written consent of the Subordinated Noteholder Representative.

ARTICLE VI
Remedial Provisions

     Section 6.01 Code and Other Remedies .

          (a) Upon the occurrence and during the continuance of an Event of Default, and subject always to any prior rights of the Senior Agent and the Lenders under the Senior Guaranty and Pledge Agreement and the Intercreditor and Subordination Agreement, the Subordinated Noteholder Representative, on behalf of the Guaranteed Creditors, may exercise, in addition to all other rights and remedies granted to them in this Agreement, the other Transaction Documents and in any other instrument or agreement securing, evidencing or relating to the Obligations, all rights and remedies of a secured party under the UCC or any other applicable law or otherwise available at law or equity. Without limiting the generality of the foregoing, the Subordinated Noteholder Representative, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law

referred to below) to or upon